Art and Mary were good friends who went through high school and college together. Art eventually became a college philosophy professor and Mary went into the business world. Mary became a senior vice-president of a management firm and learned many of
the company's trade secrets. Both Art and Mary signed one-year contracts with their respective employers. The contracts contained clauses that provided that they would not compete against their former employers for a period of one year after leaving their jobs. The area covered by the restrictions for both Art and Mary was a radius of 500 miles from the place of employment. Both Art and Mary resigned and within two months took other jobs. Art went to work for another college 50 miles away, teaching philosophy. Mary took a job 75 miles from her former employment. Her new position was similar to her former job. The former employers sued to enforce the anticompetitive covenants in the original contracts. Discuss the probable outcome of the lawsuits.
The case against Art, the professor, will likely fail because the restrictive covenant is not necessary to protect the interest of the former employer. It is doubtful that a philosophy professor would be inflicting any harm on the former employer by teaching elsewhere.
The lawsuit against Mary probably will be successful because she knew trade secrets. She held a high position in her former company, and her competition could cause it harm. The restriction appears reasonable.
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